Canadian and U.S. durum producers have the chance to make a "historic" alliance by setting up a co-operative to build and run a pasta production plant, but there will financial and political hurdles to overcome first.
Close to 80 Weyburn area producers heard this message on Monday night as members of a steering committee presented the proposal for "Prairie Pasta Producers", a durum mill and pasta plant that would be built in North Dakota, and supplied by member producers in North Dakota and southeast Saskatchewan.
A steering committee of 16 producers has been formed to get the project off the ground, with half from each side of the border. A small group from the committee held three meetings Monday in Radville, Oungre and Weyburn to gather interest, and to gather seed money donations of $250 each.
Orlin Hector, a steering committee member from Estevan, said there was strong response at the Oungre and Radville meetings, although they had much smaller numbers than in Weyburn. There were 18 producers at the Radville meeting, and 40 at Oungre, with a large percentage of producers at both meetings writing out checks to join the group.
The Americans in the project have already raised their share of the seed money, about $40,000 U.S., which the Canadians are trying to match; as of Monday night, there are over 200 Canadian producers signed up so far, with the goal to have around 250 on board.
The money is to be used to do a market scan and a feasibility study, which will determine what size plant would be viable, how much durum would be required and the cost. The project would be run as a closed co-operative, in which only producers capable of producing durum can be members, with the member producers to bring their durum to the plant to be milled and made into pasta.
The chairman of Prairie Pasta Producers, Harlan Johnson of Crosby, N.D., said farmers on either side of the Canada-U.S. border often feel they are competing against each other, but through this project can work together toward a common goal of adding value to their product, durum wheat.
The seed money is tax deductible and is considered a donation at this point, not as an investment.
"It doesn't mean you're going to invest. We hope a year from now we'll have something to invest in, but this will show other farmers and politicians that we can work together," said Johnson.
A question that came up later in the meeting pointed out the biggest obstacle for the plant to go ahead: the group will be seeking an exemption from the Canadian Wheat Board from the usual freight charges and from the requirement to "buy back" their durum if they are taking it across the border into the U.S.
As Hector pointed out, the local producers in Saskatchewan won't be able to take part in the project without the exemption, and the co-operative cannot go ahead without the Canadians.
"We want to be on a level playing field with the Americans, but in order to do that we need this exemption; that's the only way we can do it," he said, adding the seed money which is gathered will be put into an escrow account and held until a co-operative can be formed.
Minton-area farmer Herb Axten, also a steering committee member, noted that producer terminals started up because they didn't like the system, and this plant would go ahead on the same basis.
"We're going to build a pasta plant because we don't like the system. There's almost 400 members ready now. From the market study we'll do the feasibility study, and by '99 we'll be raising real money - but we're taking it one step at a time," said Axten, adding that no politicians or large corporations are involved in this project at all, only producers.
Initially the American farmers from North Dakota and Montana gathered to see if they could launch the co-operative, but found their numbers weren't sufficient to begin, and the circle needed to be expanded north into Saskatchewan. This area also contains some of the highest-producing regions for high-quality durum in North America, making it ideal as a location for this pasta plant to be built.
"We grow the best quality durum in the whole world. This durum is not grown in Texas or Louisiana, it's grown right here, and we need to take advantage of that," said Johnson.
Durum currently makes up one-sixth of all the wheat grown in Canada, with four million tonnes of durum produced last year. Of that amount, 3.5 million tonnes were produced here in Saskatchewan, the producers were told.
With these facts in hand, along with the facts to be gathered in the feasibility study and the money in escrow, the farmers hope to present a proposal to the government that will "be a tough one to turn down", said Hector, whose optimism was echoed by Johnson.
"If we take the positive way and work well together, it's going to happen. We believe very strongly it's going to happen," he said.
Asked why the plant couldn't be built in Canada, Hector explained he approached the provincial government and was told that there are no provisions for closed co-operatives right now (although the federal government is working on the issue) and there is no precedent in Saskatchewan for such a project.
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